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Trust Litigation

Trust litigation is becoming more frequent. This is due to a number of factors, such as changes in trust laws and an ageing segment of the population who created trusts. Another important factor is that the Uniform Trust Code, which has been mostly adopted in Missouri, permits a broad range of individuals to file lawsuits with respect to a trust. Indeed, “any person interested in the administration of a trust may file a petition for declaratory judgment seeking a declaration of rights or legal relations to determine any questions arising in the administration of the trust.” Schumacher v. Schumacher, 303 S.W.3d 170, 174 (Mo. Ct. App. 2010). Generally, to have standing to sue, a plaintiff must have an interest in the subject of the lawsuit which, if valid, gives plaintiff a right to relief. Switzer v. Hart, 957 S.W.2d 512, 415 (Mo. Ct. App. 1997). Missouri Courts and the Missouri Trust Code apply standing to sue liberally when it comes to trusts.

In Engelsmann v. Holekamp, 402 S.W.2d 283 (Mo. 19966), for instance, the Missouri Supreme Court found that future beneficiaries of a trust, vested or contingent, have standing to bring an accounting action against a trustee. A future beneficiary is someone who does not necessarily have a vested/income interest in the trust presently. Instead, it is someone down the road who eventually would have an immediate property interest in the trust estate. For family trusts, then, what this generally means is that grandchildren or other remote family members who would only have a present interest in the estate if the individuals before them pass away can bring lawsuits regarding most things about the trust (e.g., accounting, breach of trust claims, trustee removal, breach of fiduciary duty claims, challenges to a trust’s validity, etc.). The reasoning for this rule is that there are strong policy considerations in ensuring that someone has the power to enforce a trustee’s fiduciary duties. Siefert v. Leonardt, 975 S.W.2d 489, 492 (Mo. Ct. App. 1998). A consequence of this rule is that trust litigation can become very onerous. Typically, most interested individuals in a trust need to be joined as a party in a trust case. The reason for this is that, even though they may have a remote interest, their property rights may be affected as a result of the litigation. 

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